After a bumpy year of restructuring, Elanco Animal Health Inc. said Thursday morning that revenue climbed 46% last year and it lost less money than the previous year, strengthening its financial position as it prepares to break ground this spring on a new $100 million headquarters in Indianapolis.
The Greenfield-based maker of animal food and medicines reported a net loss of $472 million last year, an improvement from a loss of $560 million in 2020. Revenue climbed to $4.76 billion last year.
Excluding one-time costs related to integrating systems and an asset write down after the sale of several properties, Elanco reported adjusted earnings before interest, taxes and other items last year of $1.06 billion, up 100%.
It was the first full year of results since the company closed its huge acquisition of the animal health unit of German conglomerate Bayer AG in August 2020, a move that pushed it from fourth place to second place in the $33 billion worldwide industry, behind only New Jersey-based Zoetis Inc.
Adjusted earnings per share were 21 cents for the quarter, beating the Wall Street consensus of 17 cents a share. For the full year, adjusted earnings per share were $1.05.
For Elanco, it was the highest revenue and adjusted earnings since the company went public in 2018 as a spinoff from drugmaker Eli Lilly and Co.
“The Bayer combination has been working, and it is transformational,” CEO Jeff Simmons told IBJ.
Elanco shares climbed 9.5% in midday trading to $28.23.
The company said it expects seven product approvals and launches this year and will submit between five and seven new products for government review in major markets, including one or two potential blockbusters. The company makes a wide range of food and medicines for pets and livestock.
Elanco issued full-year guidance, saying it expects revenue in the range of $4.745 billion to $4.8 billion, reported net income of $4 million to $27 million, and adjusted earnings per share of $1.18 to $1.24.
Simmons pointed out the company had posted its fifth consecutive quarter of meeting the midpoint of its financial guidance ranges.
He said the company was entering a period of stability, following more than a year of belt-tightening and streamlining operations. Last year, the company eliminated more than 300 positions, including about 20% of its senior management, and announced restructuring across its marketing, international commercial operations and research and development. It said the moves would help it save about $60 million this year.
“We’re pivoting into 2022 with strength, a durable base and growth,” Simmons told IBJ. “We’re creating a more efficient, stable operation.”
The streamlining has provided $226 million in adjusted cost savings, toward a goal of $400 million by 2024.
The company ended the year with $638 million of cash and equivalents and operating cash flow of $458 million.
Simmons said he expects the company to break ground this spring on its new headquarters campus on the former General Motors stamping plant west of downtown, a move the state has incentivized with more than $86 million in tax breaks plus land for the project.
He said the design plans are “progressing nicely,” and the company expects to move into the new headquarters in 2024.